Robert Reich, a former Clinton Secretary of Labor who now favors Barack Obama, says that the gas tax holiday Ms. Clinton supports - as does John McCain - is "economically stupid" and would increase demand for gas while costing the government $9B to finance. And he’s not alone.
(via memeorandum)
Months ago we started publishing posts, critical of America’s economy. Immediately some readers accused us of overdoing it. There were some minor issues, but the economy was still quite healthy, and so forth. One problem for these individuals: George W. Bush disagrees with them. (more…)
The New York Times looks at the economic plans / proposals of the three leading candidates (John McCain, Barack Obama and Hillary Clinton). The conclusion: ‘The Republican and Democratic presidential candidates differ strikingly in their approaches to taxes and spending, but their fiscal plans have at least one thing in common: each could significantly swell the budget deficit and increase the national debt by trillions of dollars, according to tax and budget experts.’ (more…)
“Employers buffeted by talk of recession slashed 80,000 jobs in March, the most in five years and the third straight month of losses.” The AP adds: “At the same time, the national unemployment rate rose from 4.8 percent to 5.1 percent, the clearest signal yet that the economy might already be shrinking.” (more…)
This is a major development: normally, the chairman of the Federal Reserve always keeps up appearances. When it’s going downhill with the economy, he’ll try to encourage people and businesses to invest. Seldom will he imply that the economy will continue to go downhill for a while, let alone that a recession may be on its way. But that’s exactly what Ben Bernanke said on Wednesday. (more…)
From the New York Times: “UBS, the largest Swiss bank, said Tuesday that it would write down another $19 billion related to the American real estate market and said that its chairman, Marcel Ospel, would step down.” (more…)
If John McCain has one major weakness (not his age) it’s the economy. He has admitted in recent months that he really doesn’t know much about this subject, and that he’s dependent on good advisers for a good economic policy as president. Not only that, McCain has also flip-flopped on, say, the Bush tax cuts. Where he was a moderate with regards to spending and taxing once, he has moved significantly to the right ever since he announced he would run for president. (more…)
JPMorgan Chase has announced, in what’s a sign that the US economy is having some very serious problems, that it’s buying Bear Stearns for $2 a share. This while Bear Stearns “recently valued at well over $100 a share, and selling for over $50 as recently as last Thursday.” (more…)
A furor has erupted in defense circles over the Pentagon’s award of a contract for a new aerial refueling tanker to a consortium led by European Airbus over American Boeing. But, as Thomas Lifson points out, this newest clash of globalization and nationalism reflects opportunity, not threat. (more…)
U.S. employers cut payrolls for a second straight month during February, slashing 63,000 jobs for the biggest monthly job decline in nearly five years as the labor market weakened steadily, a government report on Friday showed. It’s becoming increasingly clear that the next US President will inherit an economy that’s not as strong as it once was. Of course, the American economy is diverse and able to get itself up when it’s slammed down, but still. (more…)
IN what cannot exactly be called a conservative approach, “the Bush administration and the Federal Reserve are inching closer toward a government rescue of distressed homeowners and mortgage lenders.” The NYT adds that Bush and the federal reserve do so even though “they oppose it on ideological grounds.” (more…)
Senate Republicans held together, mostly, to stop the Democrats’ stimulus package from passing, according to the NY Times:
The measure was opposed by Republican leaders who said the Democrats added too many costly provisions, including an extension of unemployment benefits, tax credits for the coal industry and increased subsidies for home energy costs.
The total cost of the Senate plan came to about $204 billion over two years, or about $40 billion more than the House version.
Stopping this bloated giveaway extravaganza is a good thing.
The Federal Reserve has yet again acted: first it cut short-term interest rates with 0.75%, now it cut it with 0.5%. This means that the short-term interest rate is 3%. By doing this, the Fed hopes that people and companies are inspired to spend (bigtime), which may then help the US avoid a recession. (more…)
Another presidential campaign, another also-ran badge for John Edwards. Only this time he won’t even get the VP consolation prize.
Edwards got lost this year amidst the Clinton v. Obama rumble. You could say a rich, middle-aged white guy simply had no shot in a year when historic firsts beckoned the party. But, really, I think voters just weren’t convinced that this patrician with the Southern drawl as meticulously maintained as his hair would really change America for the better. (more…)
It’s sad that there are people who need foodstamps, and perhaps even sadder that some who need them don’t have them. However: foodstamps have nothing - and I mean nothing - to do with “boosting the economy.” If you want to boost the economy, you lower spending, taxes a bit and that’s that. You don’t let the government spend more, especially not on something like foodstamps. (more…)
This is hard to follow if you weren’t an economics major, but it’s worth a try. Perhaps George Soros has a political agenda in saying this in the Financial Times — like getting a Democrat elected. But nobody ever said he was stupid.
The current financial crisis was precipitated by a bubble in the US housing market. In some ways it resembles other crises that have occurred since the end of the second world war at intervals ranging from four to 10 years. (more…)
In a rare show of bi-partisan glad-handing, the House and President Bush have agreed on a so-called economic stimulus package that consists largely of “tax rebates” to be given to individuals earning < $75K per year and couples making < $150K.
From this perspective the plan could be called a tax cut and therefore be considered a good thing. However, the NY Times says that “the stipend of at least $300 would be paid to all workers receiving a paycheck, even those who did not earn enough to pay taxes last year.” (more…)
An interesting debate, some interesting posts, about the Fed and interest rates. What can the Federal Reserve do, what can it not do?
IN what’s becoming old news quickly, stock markets in Europe and Asia continue to go down. The talk of a recession in the US is doing damage before it truly arrives. (more…)
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